A dazzlingly embroidered altar frontal, the work of soldiers recovering from their injuries in the first world war, will be on display and in use again at St Paul's Cathedral in London, for the first time since the altar for which it was made was destroyed in the second world war bombing.

It was used for the first time on Sunday 6 July 1919, at the national service of thanksgiving for peace at the end of the war in the presence of the King and Queen and many of the 138 soldiers from the UK, Canada, South Africa and Australia who had made it.

It will be used again for the song eucharist service this Sunday evening, marking the eve of Britain joining the war, when foreign secretary Sir Edward Grey told parliament that war was inevitable. Some descendants of the men who stitched the colourful flowers and birds will be at the service, including James Muth, a lieutenant colonel in the Royal Canadian Regiment – and grandson of Lance Corporal James Ernest Muth – who will read one of the lessons.

The story was passed down in his family for a century that Muth had embroidered a beautiful yellow tulip for an altar frontal in the cathedral. However, in 1940 they learned that the altar had taken a direct hit in the Blitz, when the cathedral was damaged despite the heroic bomb-clearing squad who spent every night on watch on the roof. Although the building survived, and a newspaper photograph of the cathedral's dome standing in swirling smoke above the ruined city became an icon of British resilience, the Muth family assumed the cloth had gone with the altar.

The hand-illuminated book containing the names of soldiers who worked on the altar frontal. Photograph: Peter Macdiarmid/Getty Images

In fact it had already been carefully stored away, with a hand-illuminated book recording the names of all the craftsmen. The replacement altar was the wrong size for the cloth, and so it remained in storage for another 70 years.

Muth, who served with the Canadian Engineers, survived being wounded twice and being gassed on the western front, and was in a convalescent home in Sheffield when he took up his needle. Other parts were worked on by men in homes and hospitals all over the country, and pieced together by the Royal School of Needlework in London. Embroidery, requiring patient detailed work, was thought a particularly useful skill for improving both physical and psychological ability.

When the cathedral decided to bring the cloth out again for the centenary, an international appeal was made to contact the families of the men who had worked on it. Muth's granddaughter, great-granddaughter, grandson, and son Malcolm, an 83-year-old Presbyterian minister in Canada, all got in touch. Muth, his son recalled, vividly remembered his time in England.

"My father often spoke of the kindness of the doctors, nurses, and others during his convalescence. He was wounded twice and gassed, and so spent a long time in hospitals in England and after he came home.

"He did more embroidery here. He died at age 83 after a useful life in the community: the father of seven children, carpenter, church elder, village councillor, and so much more."

The names of all the embroiderers, and many family photographs and stories are now on the cathedral's website – including that of an Australian soldier, Jim Allen, an acclaimed sprinter who had to have both legs amputated after being injured at Passchendaele, but who went on to drive a specially adapted motorbike, and then a car, in which he drove repatriated Australian soldiers to hospitals in the second world war.